By Anna Sekunova and Kim Do
We previously reported on Trans Canada Trenchless Ltd v Targa Contracting (2013) Ltd, 2021 BCSC 2518, a decision where in a surprising result the court allowed a claim of lien to proceed even after a plaintiff subcontractor, Trans Canada, failed to name an owner as a party to the action or include language seeking to enforce its lien in a notice of civil claim. Indeed, Trans Canada was allowed to add the owner as a defendant and amend its claim to expressly include a claim to enforce the lien. In doing so, the Court held that while there was no discretion to cure its failure to strictly comply with s. 33(1) of the Builders Lien Act (the “BLA”) (a provision which requires that an action to enforce a claim of lien be commenced not later than one year from the date of filing), it would be just and convenient to allow the subcontractor to amend its pleading to add a claim to enforce the lien, despite the expired limitation period.
That decision was recently overturned on appeal in Trans Canada Trenchless Ltd v Targa Contracting (2013) Ltd, 2022 BCSC 438, where the court concluded that the lien was in fact extinguished.
The court made several notable holdings, including that a claim in lien remained a claim in rem and the owner of the land against which the lien was asserted was a necessary party. Thus, the owner had to be named in an action to enforce a claim of lien even if it had no contractual relationship with the claimant.
Further, s. 33 of the BLA required both the commencement of an action and registration of a certificate of pending litigation (the “CPL”) to be performed within one year after filing of the claim of lien. A failure to file was non‑compliance, regardless of intention. If the parties entitled to assert lien claims did not comply with s. 33 of the BLA by commencing an action to enforce the lien and filing the CPL, then the lien absolutely ceased to exist, and no action taken by the owner could revive the extinguished claim.
Similarly, the factors which allowed for the amendment of pleadings after the expiry of a limitation period had no application in this case as the underlying lien was extinguished. Amending a notice of civil claim could not revive the extinguished lien. Accordingly, it was not just or equitable to allow amendments which introduced a claim to enforce an extinguished lien.
This case serves as a useful reminder to all lien claimants that when drafting pleadings to enforce a lien claim, it is especially important to identify and add proper parties, including the owner, ensure there is language seeking to enforce the lien, and file within the required timeline. Taking these precautions will avoid an unfortunate situation like in this case where failures to do so led to a lien claim being extinguished.